give the reins of government to someone who will double down on trickle down. it is thursday, september 6th, 2012. "squawk box" begins right now. good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with joe concern than and andrew. john hardwood will be joining us. expectations for president obama's address tonight. first though let's get you up to speed on the morning's top headlines. first up, the ecb is meeting in frankfurt today. this is a huge story. a rate decision is expected at about 7:45 eastern time. the real news is at 8:30 eastern. that's when mario draghi will be holding his news conference. the ecb president is expected to announce his framework for bond buying. it's said to be unlikely that intervention sides or yield targets will be given.

we'll have more in a few minutes. then of course we'll be bringing you the 7:45 announcement. about half of the economists polled are looking for a cut there interest rates. we'll be bringing you the headlines from draghi's news conference as they happen. german chancellor angela merkel will be holding talks in madrid today. they are expected to focus on spain aus austerity measures. the august adp numbers will be coming out at 8:15 eastern time. the u.s. economy added 145,000 private payrolls last month. obviously this is all huge news. it will all have an impact on the election bringing you these numbers and the instant analysis from the man behind the report, joel praken. it sets up for a big morning. thanks, becky. let's get you through some of the corporate buzz. news corporation cutting this year's bonuses for four top executives including rupert murdock and james. they're citing fallout from the

phone hacking scandal. canada is saying an internal investigation has -- canna has been accused of colluding lowering prices in a land deal. and amazon expected to launch the new version of its kindle fire today. an event planning earlier. it's supposed to be thinner and lighter with a camera and better display. last night during the nfl game on nbc fans saw a rare minute-long amazon commercial that showed off a pair of devices that cnn is now reporting may be the long expected and much rumored new kinldle. joe, we'll have to get you one of those. >> what? >> a new kindle. >> a new kindle. i don't have an old kindle. >> we'll get you a new kindle. >> in other headlines, south korean regulators are

investigating complaints charging that samsung is abusing its dominant position in wireless. they're locked in a patent dispute in ten countries. the european commission is launching an investigation into dumping of solar panels. they're drawing a warning from china that restrictions on its exports would hurt this area. a group of european solar companies are complaining that they're selling stuff at below cost and a watchdog report today warns that only a handful of healthy nations are tackling bribery by companies vying for positions. the group is called trans sparns si international. they've led efforts to call companies. the two countries dealt with 25% more cases last year than they did in 2010. but the report shockingly says

that companies like -- or countries like mexico and brazil and japan and france made little progress in cracking down. >> kind of stunning. >> yeah, it is stunning. you can see from the, you know, action in walmart stock how deleterious it can be. >> the stock has gone straight up. >> it has. >> let's get a check on the markets this morning. yesterday the markets ended mixed. they barely budged over the course of the morning. dow was up 11.5 points. s&p down by 1.5. the nasdaq was off by just over 5 points. this morning though you're going to see a lot more movement because we have a lot of news coming for you. right now dow futures up by 82 points. s&p futures up by 8.5 points. nasdaq up by 17 points. we have the adp report coming up at 8:15 which should give us some indications about what to expect on friday from the big jobs report. last month that number was dead on. we'll see what happens. expectations are for about 150,000. also you have the ecb in all the news that's coming from that.

that could be the biggest market mover this morning. a lot of expectations on the details we'll be hearing from the ecb. already from early stuff leaking out suggests that they will be -- i'm not talking about the oe or any of that stuff. the early details do indicate that the ecb is going to be talking about some bond buying. probably will not be giving us any yields -- specific yields numbers that they're looking at, caps, but we will be getting more details from this. when you hear about the bundas bank, they don't want to do it. >> they don't want to do it. >> we're going to hear real details. >> whether it's like a stock buy back program. you announce it. you don't say how much. >> authorization. >> just by authorizing what that means. >> when is the election? is it november? >> 62 days. >> is it november 6th? why are you laughing? is it november 6th? >> i think it is, yeah. it definitely is. >> it's a tuesday, right? do we get friday numbers? do we get october employment

report? >> i bet we get it right before, right? we'll have a september number, october number, november number. >> we do? we get three more. >> yeah. but this friday is a key one, although the friday right before. wow, that's going to be something. >> we're going to let you talk to harewood. would you like to toss it up? >> no. no. no. it's kind of like the nitroglycerin of reporters. see if he's gotten sleep. >> he's going to be great. okay. let's get to charlotte and talk to our own john harewood. he's covering the dnc. he's gotten up early. you were up late last night. tell us about clinton and tell us about everything. >> reporter: clinton, andrew, was a very valuable testimonial for president obama. nobody's got more credibility on the economy given the economy that he presided over. you can argue about exactly how good it was and what cause the it to be good. nevertheless, he was there and one of the things that president obama's suffering from right now and that other presidents have

risen or fallen on is that it's a results business. the results on your watch matter. what president clinton said last night was to tell voters not to blame president obama for the difficulty of coming back from the recession and just to be a little patient with him. here's bill clinton last night. >> no president, not me, not any of my predecessors, no one could have fully repaired all the damage that he found in just four years. but he has desh has laid the foundations for a new modern successful economy, a shared prosperity. and if you will renew the president's contract, you will feel it. you will feel it. >>

>>. >> reporter: renew the president's contract. that was his endorsement. this picture of president obama getting a hug from president bill clinton on the stage. this completed a reconciliation since that tough campaign four years ago when barack obama, then senator, beat hillary clinton in the democratic primaries. then made her secretary of state. now these two men are coming together, one democratic president trying to help another one win a second term, guys. we'll see from the polls after the convention whether that combined with michelle obama and president obama's speech is going to produce a bump. it's a polarized electorate. bumps aren't easy. democrats are happy with last night. >> john, very early on in clinton's speech he really tried to own the obama line about you didn't build it. i thought that was actually somewhat surprising really trying to suggest that actually maybe that line he actually meant the first time around. >> well, democrats do mean it in the sense that not in the way in which republicans have been using it against the president,

but they do believe -- i mean, it's the whole theory behind hillary clinton's book "it takes the village." we all remember that. it's the idea that collective action is a big part of our individual success, which is something that when we look at, say, a country like iraq where we've been at war, the emphasis on the rebuilding process is on creating institutions and civil society and rule of law and all the things that allow individual enterprise to prosper. that's the point the democrats were making and they're trying to drive that home. >> do you have any color on this whole god/jerusalem practice? is that how you pronounce? >> joe talked about it yesterday. platforms are of greatest interest to political opponents of either party, of the republicans in tampa, of the democrats here in charlotte, because they're statements by activists that get put down. they kind of felt the on rushing linebackers on god ander rus is a limb. they called an audible and put

the phrases back in even though some of the delegates on the floor didn't like it, there was booing, false starts. i've got to tell you that's not the best color from yesterday. >> what's the color? >> the best color was after doing larry kudlow's show last night i went to a party near the convention. it was a pool side party hosted by some wall street guys at the ritz carlton hotel and at that party former treasury secretary bob rubin actually fell in the pool. >> what? >> did you get it on video? >> i don't believe this unless you have a shot of it. >> reporter: i tweeted it. it bounced around but, no, what happened -- >> you tweeted a picture of it? >> reporter: no. no. no. no. i could not get a picture of it. somebody took one but wouldn't send it to me. what happened was this party was in a room where you walk in the door and the pool was right on you once you walked in the door. i could have fallen in the pool myself. i looked and said, whoa, that's close. and i got there after this

happened so i didn't -- did not actually see it, but rubin took a false step, fell in the pool up to his chest. his hair did not get wet. he got himself out of the pool. >> in a suit? he's wearing a suit? >> suit, shoes, the whole thing. >> oh, my gosh. >> got out of the pool, got a drink and mingled at the party for an hour. later at the party tom brokaw showed up and it turns out that tom and rubin have neighboring fishing properties, vacation properties in montana, and brokaw said, the guy fell in the pool at this party? i own him forever now. >> well, not anymore because you just outed him. wow. >> reporter: it was kind of funny. people were quite taken by that. >> that was great color. you probably should have led with that at the beginning of the segment. john, thank you for joining us. >> reporter: i was saving that for the kicker. >> appreciate it. in global news, global markets this morning, kelly

evans is standing by in london and are people feeling optimistic, kelly, about this? >> joe, let's just take a look at the markets and let them speak for themselves. i'll show you first what's happening in european economic markets, ftse 100 up. that's the underperformers. the dax and the ibex up 1.5%. if you're wondering why it has something to do with expectations wrapping up ahead of the ecb's meeting today. we thought we would hear unlimited talk which investors have eagerly been waiting for. that counter veiling talk. they were trying to placate investors who would prefer not to see measures that would mon know advertise debtor increase the ecb's balance sheet. plenty of concerns about what the european central bank will do. first we get into equity markets

which are broadly up across the board. also to bond markets this morning. if i can show you the curve on the ten year. give me one second. the major european bond yields here. let's see if we can bring that up. the ten year german bun, that one's been rising. if you go to 1.6, 1.7% if the ecb does deliver. in spain, 6.3% is the yield there. that follows the spanish auction that went over well on the short end. that's where the ecb is rumored to be focusing these purchases. he's vindicated that he will focus. some cautionary talks saying that he looks at the steepening of the spanish curve of a sign that investors are talking about the ecb getting ahead of the curve. two year, 3.34% is the yield here. that's higher than this morning. meantime, the ten year, 6.37% has been coming in. still big difference though from

some of the better levels that we saw more recently. just around lunchtime here so about 7:45 a.m. for you guys. that's the time to watch when you're going to hear from mario draghi. the european central bank may be taking down its forecast. pressure is on for the central bank to respond to those concerns. if history is any guide, they may fail to live up to expectations. jon claude junker is there. the last time he was at the meeting was the end of last year so there could be that announcement coming. that's what's got a bid under markets. we'll see if it carries over. guys. >> kelly, thank you very much. we'll be watching very closely. those yields are very important. she was talking about 6.3%. we'll talk to you again tomorrow. when we come back, a man who knows the stakes of tonight's democratic convention better than most. he ran the dnc and made his own run for president. howard dean will be joining us live from charlotte. first though, some squawk sports buzz.

the dallas cowboys opening the nfl season with 24-17 win over the super bowl champion new york giants. tony romo threw for 307 yards and three touchdowns. meantime, forbes magazine reports the cowboys have become the first american sports franchise worth more than $2 billion. franchise's overall worth is $2.1 billion. that's a billion higher. >> that's on during the convention? >> and the u.s. open. >> roddick zblost and the yankees won. >> all the guys are watching football or tennis. do the democrats care if we vote? they don't care. >> none of their voters were watching the football game anyway. bob...

oh, hey alex. just picking up some, brochures, posters copies of my acceptance speech. great! it's always good to have a backup plan, in case i get hit by a meteor. wow, your hair looks great. didn't realize they did photoshop here. hey, good call on those mugs. can't let 'em see what you're drinking. you know, i'm glad we're both running a nice, clean race. no need to get nasty. here's your "honk if you had an affair with taylor" yard sign. looks good. [ male announcer ] fedex office. now save 50% on banners.

welcome back to "squawk" this morning. let's check out today's national weather forecast. alex joins us from the national weather channel. >> good morning to you. as we head through the day, the eastern third of the country, look like we're going to find spotty showers and storms to deal with. parts of the northeast and particularly as we head into parts of the south. that has forced the president's speech indoors in the charlotte area. that risk of storms in place. the middle of the nation, mostly quiet. the heat is on in the southern plains across texas. more triple digit numbers. even after labor day it is certainly quite, quite steamy in all of those locations. into the west coast, feeling some warmth. 81 in seattle. a bit above average. dry along the west coast.

the interior we may find showers and storms impacting sections of the northern rockies. as we head into tonight, storm system begins to track into the middle of the country. that will provide us with rain. minneapolis dealing with that. by friday, tomorrow, that will slide towards the south and the east. could potentially bring us some strong, severe storms. st. louis working over towards indianapolis dealing with that. eventually getting into the ohio valley once we get into the afternoon. the thing we will find with this system, behind it much, much cooler air moves in. as we head on into tomorrow, high temperatures will be running anywhere from five to ten degrees below average. minneapolis, you were in the 90s. 60s as we head into tomorrow. 70s into the weekend. cooling things off in the east. by sunday, 79 degrees in and around d.c. where we need the cooldown though, it's the southern plains. mentioning how hot it's going to be today. eventually that cooler air northward will begin to slip south ward. by the time we get into the latter part of the weekend, no

more hundreds. guys, back to you. alex, thank you very much. we'll be keeping an eye on that. also keeping an eye on what's happening back in charlotte. tonight president obama takes center stage at the dnc. >> joining us is former vermont governor and cnn contributor, howard dean. howard, last night was a big night with president clinton stepping up and offering the first time that a former president has actually nominated a sitting president. >> yes. >> what did you think about what happened last night and the other question is, how big of a problem is it to have the nfl playing and so many other sports events taking place at the same time? >> it was tough. there's nothing you can do about that. the schedule is very, very difficult no matter what you do. before labor day, after labor day. things compete with you on television. that's the way it is. i thought the president, clinton, did a great job because his speech was pretty nonpartisan. he talked a lot about the republicans that president obama had pointed to the defense department. >> i heard a lot of partisan stuff in it. he said last week everything

that happened in tampa was the wrong message. i mean -- >> well, yeah, that's true. of course. it wasn't quite as slashing. >> when you're a middle of the roader like howard dean. >> that's right. >> you're going to hear things like that. >> that's right. >> it was mostly middle of the road, governor? >> absolutely right down the middle of the road. seriously, bill clinton's favor rose 69%. up very, very high as an ex-president who has done a good job for a lot of people. he has worked very -- said some very complimentary things about both bushes last night. he went out of his way. i think the idea really here is you have an ex-president. he has a brand that is a very good brand like jimmy carter's has been as an ex-president. they use that well to try to connect with swing voters by being nice to republicans. >> howard, he can keep a straight face. i love it. >> we think that carter has a good brand like clinton? you put them in the same

category? >> he actually does. he's gotten himself in a lot of trouble on the israel issue, but carter has had a good brand with his work with the homeless and habitat. check it out. you can google it. >> he's done a lot of good work since he was president. >> right. >> to put them is the same category, i'm not sure others might do the same. >> check out the numbers. different kind of personality. clinton has an enormous personality. there hasn't been a president like bill clinton with his ability to connect since franklin roosevelt was in the white house. this is a special human being. i thought he did well. he took the edges off the partisanship. every convention is going to be partisan. he did reach out to ind peb dents and swing voters and i think he did it well. >> do you know about the story behind the story on a move back to the smaller venue? >> you don't. but yesterday there was not. >> they could have filled -- was it because it was called bank

america? could they have filled it? >> well, they did in denver. i don't make those decisions. i thought it was a bad decision to go to the stadium in the first place. it doesn't rain -- >> impersonal. >> no, it's great. in denver it was fantastic. it doesn't rain in colorado in august. it rains a lot in the southeast. you can't have 80,000 people in a stadium with a lightening storm. you just can't do that. if you look at the forecast, that's what it's for is for lightening this afternoon. they didn't have any choice really. >> howard, last night, you're right, president clinton and his popularity, his appeal is something that we saw the pictures john harwood was showing us about the two embracing, clinton and obama on the stage. that's certainly the image that democrats want to send out. >> that's right. >> mitt romney took the other side. his campaign came back and said this was showing the great distinctions between the two of them. >> i think what the message is

from bill clinton when i was president we create 15d,000 jobs and bush took it away and obama will restore it. this is politics. when you have bill clinton on your side, it's much better to have him on your side rather than not on your side. >> whatever president obama says tonight we do have a jobs report that's out tomorrow morning. >> right. >> that could very likely overshadow. it will either give him the added boost or strong number if it's a weak number. >> my guess is it will be a middling number. what are the predictions becky? >> 125,000 which is down from 163,000 we saw last month. >> to be honest with you, i've said this on the program for the last four months. now it's not really important. they don't vote on the jobs report, they're voting on what happened with the economy. jerry ford never got the benefit of any of that. the uptick started in september

and it was too late. the jobs report is an indicator. it doesn't change how people feel about it if they don't happen to have a job. we are where we are with the economy. it will muddle along. it's certainly better to have 125,000 new jobs than it is to be losing 600,000 jobs a month which is what we were doing when barack obama took the oath of office. the republicans will make the case that you're not better off. we're going to make the case that you are better off. not as well off as we'd like, but much better off than we were when we started in 2008. >> having said that you'd rather see a stronger number and see a drop in the unemployment rate? >> absolutely. even that at this point that starts not to affect the voting very much because people feel the economy. it's not the numbers they vote on. >> weird how nothing has moved these numbers. it's very weird. >> yeah. >> it's like 47, 46, 46. when does it -- >> i don't know. polling is difficult, too. you talk to thousands of people and you're really measuring -- i mean, the standard deviation on

a difference of .1. >> right. >> nobody knows at this point. the debates could mean a lot. >> the debates will mean a lot, i think. both sides hope to hit home runs there. what mitt romney gets out of the debates is he gets to stand side by side with the president which makes him look presidential. what obama gets is he's obviously had the job for four years and he knows the stuff inside out and is good on policy. >> i guess it's always been like this, howard, but i look at the mail that comes in from both sides. never seen them so divided and so sure of themselves on both sides. >> no coming around. >> so hateful of the other side. it's really -- i don't know what's going to happen no matter who gets elected. how we deal with the rift. >> my theory is when the new generation takes power, that will be betterment the under 35s don't put up with this kind of talk. our generation just wants to fight the culture wars to the death. i think it's not so great for the country. >> at least we come together once in a while. >> yes, we do. >> thanks, governor. see ya later.

why mark faber says european stocks could correct up to 20%. today, our financial advisors lead from a new position of strength. together with bank of america, they have access to more resources than ever before. a steadfast commitment to help you achieve your financial goals in life. that's the power of the right advisor. that's merrill lynch.

♪ ♪ good morning. welcome back to "squawk box" here on cnbc. i'm joe concern than along with becky quick and andrew. a among our stories, the dnc wrapping up in charlotte tonight. president obama will officially accept his party's nomination for re-election. and that will happen in primetime. morning money's ben white will join us with the headlines.

>> in fact, he tweeted that harwood told him a great story about bob rubin falling in a pool. we heard it here first. >> i have learned i don't light tweeters, twitters. i don't like the twitterspere. >> i said this earlier, jonathan, i learn a lot of things. >> i still learn things from him. he was our boss. that's where i learned about the booing when they were booing. not a good move when you get the convention booing for god. i don't know, the optics of that, booing for god. god, huh? >> the president wanted it put-back in. >> but they took it out. jerusalem. andrew. you're covering a wide swath of people that are going to go. that sucks. right? and you can't control a crowd. you can't control, you know, the outliers in there that are -- >> you're right. who does that? >> i know. i know. our next guest is well known for his dire predictions.

he currently -- regardless of what you believe. so many people are -- i just -- i don't know. >> they just make bacon. >> yes. >> he corrected the forecast, numerous financial forecasts. he's got the gloom, doom report. i wonder where he is today. with mark, i want to hear what his opinions are on the market but i also just want to know about his personal life. he's a colorful guy. marc, where are you? >> i'm in hong kong. >> oh, boy. >> a wonderful city. by the way, i was very happy you had howard dean on. i think he's a very bright individual. i met him once and i have to say, as a foreigner i was very impressed by the speech of bill clinton. i think he spoke extremely well, almost as well as clint eastwood. >> they both start with clint. clint ton and clint eastwood

marc, when i saw your 20% number, having read some of your other recent musings and predictions, i thought maybe you got less bearish. >> yes. i want to put this view in the context of having bought european shares in portugal, spain, italy and france for the first time in my life three and four months ago, right at the lows. and now these markets have rallied between 20 and 30% in a very brief period of time. i'm not selling them, but i said when i was asked would you buy more, i said, no. i want to wait for the market to settle down once again and then they asked me by how much. i said, maybe the correction could be 20%. but i said i don't expect new lows. >> all right.

the recent writings i'm talking about, and just like this was sort of mischaracterized maybe or hyped or whatever you want to call it, i'm seeing you say a global -- i hope i don't overstate it, but a global depression. a global depression is on the horizon? i don't know if i'd call it imminently. >> no. no. >> no? >> i -- i said that eventually the financial system will go broke. >> oh, okay. all right. >> we'll have a crisis. i didn't say tomorrow. >> okay. >> i said it could happen in three years or five or ten years' time and before it happens there will be much more money printing. theoretically when it happens the dow jones could be at 100,000 and maybe at the million, who knows, depends how much money you print. >> all right. that would still be something three years, five years, ten years, that would still be something that sounds really disruptive to me, and i don't know how you prepare for it,

whether i guess you'd need -- i would think you would need guns and gold if that's really coming, marc. >> food. >> you need a farm. you need a farm and you have to train yourself not to depend on the internet and mobile phones and so forth and so on. because when it happens it could happen because of a cyber attack that would trigger such an event or any kind of other act of warfare. but we have to prepare for that. it's like you have an insurance. i don't carry insurance policies but, say, you have insurance for all kinds of eventualitieeventu people who can afford they should have insurance for that day when it will happen. >> years ago when i was a stock writer i remember seeing a comic strip that said, stock market sold off when it was -- when we could tell an asteroid was going to hit the world in three days and destroy it. the market rallied when the

market left and people expect it. so even though that's kind of -- this is far enough off, marc, where we would still like to know what you think of of draghi and what you think of what's going to happen domestically, china. in the near term are we in a slowdown or sort of just steady as she goes? >> i like the question, are we in a slowdown? there has been a very significant economic slowdown global globally in real terms. we are in recession in europe. we have hardly any growth if it was measured properly in the u.s., and in asia, i'm not saying we're in a slump, but we have a tremendous recovery, 2009 to 2011, and just over the last six months the asian economies have come off the peak. in other words, we have high

economic activity but in my view no longer any growth in asia. >> no longer any growth in asia? >> well, it depends how you measure it, but in real terms if you look at export figures, industrial production in various countries and it continues on, then i would say there is practically no growth. now if someone comes and argues asia's growing at 2 to 3% or someone else says, no, it's contracting at 2 to 3%, to measure gdp is not all that relevant. all i can tell you is there has been a very meaningful slowdown and i think it will continue to slow down. >> do you think it's into a death spiral at this point and that there's not going to be any breakout from it? >> no. no, because in asia we don't have the unfunded liabilities that western european economies and the u.s. and japan have.

we have essentially relatively solid financial conditions in asia, but some countries, you know, like vietnam car sales are down 40%. steel production or steel usage is down 40% from the peak a few years ago. so we have in some countries already a meaningful slowdown and by and large if you talk to busine businessmen, business has definitely slowed down considerably. >> marc, china's eventually going to overtake us, i guess. we're still the world's largest economy in the united states. i would imagine if in three to ten years the financial system were to collapse because of the overprinting of money, i would imagine we would have a lot to do with that as the biggest players in all of this. does that mean that you are pessimistic about the united states' ability to come to grips with its unfunded liabilities and entitlements? is that what's going to cause this, we're not going to fix

these? >> i'm very concerned that regardless of who will be in the white house next year, the republicans or the democrats, the fiscal deficit will stay above a trillion dollars as far as the eye can see. and that more money printing is on the way, qe 3, qe 4, so on. but you understand i want to clarify one point, i am bearish about the financial system and i think eventually it will collapse, but if you think it through, what is better to own in a systemic crisis, cash with the banks, treasury bills, or real estate in the u.s., or equities? i think that real estate in the u.s., i'm not talking about west 15 where sandy sold his condo for 8 millio8 million.

i'm talking about real estate in georgia, nevada, that real estate is relatively inexpensive on an international scale. you have a house, eventually you keep that house unless you borrow too much money, but that is the problem. equity. equity. >> go ahead. sorry. >> mcdonald's will still be around no matter what crisis will happen in the world. johnson & johnson will still be around. procter & gamble as well as the european blue chip companies and asian blue chip companies. i'm not sure that sovereign bonds will still be around. that is another issue. >> the rule of law to protect our land, i see what you're saying now. so the financial collapse really means a huge devaluation of all of our purchasing power for all currencies, but that could still be maintained. some value would be maintained in equities? >> yes. >> you would have to assume

there's a stock exchange to sell it to someone else. rule of law, you won't need people guarding your property. i've seen too many movies, marc, like "the road" and some of these other things. i don't know. "fat man." >> i don't watch movies, i watch reality tv starring the president and germany over the last 1 hundred yea00 years. the fact is people who own shares in germany and properties in west germany, the ones that own bonds and cash, cash and bond holders got wiped out precisely three times, lost everything. the ones that own equities, they still have the equities. >> marc faber, thank you. we appreciate t. you stopped listening when he talked about the flyover states. you're like, whew. >> i didn't even know what he was talking about. >> yeah. where are those? why would anyone have -- >> if it's not upper -- >> upper west. >> that's where it is. coming up, morning money's ben white on the headlines

coming out of the dnc in north carolina. i do know that's next. like our all-in-one trade ticket. we put strategies, chains and positions all on one screen. start trading today with optionsxpress by charles schwab.

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today marks the final day of the democratic national convention in charlotte. ben is joining us. a columnist and reporter for politico. we talked to howard dean. he said the jobs report at this point doesn't matter all that much. the people have made up their minds and they know how they feel about things. i think you have a slightly different take on that. >> it does matter. it's a big headline that everybody is going to see. it's going to tell us the direction of this economy. i think the big problem for president obama right now is if these numbers start moving the wrong direction. we all know the economy is not great. we've been sort of stuck in the

mud. if we start seeing unemployment going up and the jobs number going down from 163 to 125, below 100,000 would be the disaster. people don't make the decisions based on one number but they make them based on what they see, how the economy is going. if the direction is the wrong way, that's the worst thing for president obama and that could blow out anything he says in his speech. >> do you think there is the same upside surprise to the help he might get if the number is incredibly strong? is this really more of a down side risk? >> i think it's more of a down side risk. doesn't seem that it's likely to be that strong. if it got over 200,000, that would be a real big bump enhancer for him from the convention if it goes above that. i don't think it will happen. it's downside risk. if it stays status quo, it stays where it is. the economic narrative doesn't change. >> we talked about that, those numbers, 46, 46, 47, 47, doesn't matter where they are. i was thinking about the right

track, wrong track. i don't know whether the people that are at 8.3, some of those people, if you look at u 6, if you take a look at the bigger number, 15% that has given us the number. they're working an hour a week because they can't get anything better. i don't know whether they are watching on a friday. i just know how they feel and that right track/wrong track number, have you ever seen it above 32%? >> no. >> i mean, i've never seen it above that. >> yeah. it's very bad. the positive that obama has is people like him personally. they're not quite ready to fire him from the job. he's holding on to that. he has to enhance that tonight. they definitely don't think we're on the right track. the importance of bill clinton which says, look, this is where we came from. this is how bad things were. we're moving forward based on president obama's policies. i think the key thing clinton said was even i couldn't have gotten us moving faster. you all love me. this is a real difficult situation he inherited and that's where we are now. >> did you get to that tony

james party where bob rubin fell in the pool? >> i don't. it sounds like the party of the week that harwood was talking about on the air. the best part of the story is he gets out, drips dry and has a drink. that's bob rubin for you. >> i saw a puck tur online not of bob rubin but of the room. it doesn't look like a pool in ground. >> sitting pool? >> in the middle -- >> like a nice little thing in the middle of the living room. >> exactly. that's what it looked like to me. >> yeah. the way i heard it is you walk right in and the pool is right there. pretty much anybody could have just dropped in. it sounds like he handled it pretty well. >> ben, real quick, on morning money a couple of weeks ago you ran a sort of speculative sort of running piece over the week about who could be the next treasury secretary if obama were to win and i think if romney were to win. i was curious if you got any new intel while you've been down there? >> not really. roger altman is still in the mix for obama.

even tony james gets a few mentions. he's certainly on the scene. i don't know that obama necessarily goes with a wall street guy. he goes with somebody that can work with a big debt. somebody like irskin bowls would be at the tomorrow of the list. i don't think that list has changed all that much. i doubt that obama would go with a wall street guy. there's names in there. he wants a guy that can talk to congress and balance the budget and get a real deficit debt deal done. >> you have a lot of wall street guys floating around. >> there are a few. they're keeping a real low profile. i don't think they were too psyched with elizabeth warren's speech. bankers are here. tony james are here. some are still supporting obama, although not a lot of them. >> did you see some of these excerpts from woodward? >> he writes a book every week. >> he does. >> interesting, boehner/obama? >> yeah. i think he's spewing polls which, you know, it makes sense. he thought he was on the cusp of getting something big done.

it was an accomplishment he could have talked about and he didn't get it done. >> 800, if you try to go up 400, that's 50% more. >> he could make the argument he should cut it right there. he had a pretty good deal. he had revenue on the table. >> i don't think either one of them either one could deliver their base. >> maybe they weren't as close as they thought but he was really upset that day. coming up amazon set to unveil its latest kindle. will it be a game changer in a highly competitive space? ♪ it means cleaner, cheaper american-made energy. but we've got to be careful how we get it. design the wells to be safe. thousands of jobs. use the most advanced technology to protect our water. billions in the economy. at chevron, if we can't do it right, we won't do it at all. we've got to think long term. we've got to think long term. ♪ [ male announcer ] how could a luminous protein in jellyfish,

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oh, hey alex. just picking up some, brochures, posters copies of my acceptance speech. great! it's always good to have a backup plan, in case i get hit by a meteor. wow, your hair looks great. didn't realize they did photoshop here. hey, good call on those mugs. can't let 'em see what you're drinking. you know, i'm glad we're both running a nice, clean race. no need to get nasty. here's your "honk if you had an affair with taylor" yard sign. looks good. [ male announcer ] fedex office. now save 50% on banners.

we're back with the tab lle amazon is expected to reveal the new kindle fire. will it compete with the infamous ipad? >> we're looking for two prices, one at a more competitive price point. >> what are we talking? >> one may be lower in terms of closer to $100. >> $100? >> yeah. >> for a color, real -- >> right, with potentially some ad support so you can get some rebate on that. >> which they're doing now the regular kindle, a cheaper version. >> and one closer to the $199, which will be more in line with the google nexus 7. >> how much money are they going to lose on each of the devices and does the economics of this whole tablet war make sense?

>> that's where even though you've seen the stock run up quite a bit into the press conference, for investors of amazon i think it's a little bit of a mixed emotion in terms of whether or not they're excited about amazon even being in the business. you could say the same for google. >> goingle is losing money on the nexus as well. >> right, and i don't cover nokia or apple but i think for some of the other hardware manufacturers you have players like google and amazon willing to come into the space and invest heavily. >> this is a razors and blades game for amazon in some sense, no? >> yes, and for investors while they'd like to see a product that is compelling for users and will sell well, i think ultimately they want to see when does this actually help the bottom line, too. i think that today depending on how things are priced, that's not -- >> would wall street be happier today if they came out with a device that cost $ 99 and it was

clear they'd make money on each even though they'd probably not sell in the same volume? >> for some investors i speak to, yes, but for some of the real sort of long-term amazon bulls who ta k take more volatility they see this important to defend and expand their overall platform. >> real quick there's a rumored report that maybe this device, this kindle will act as almost like an itv, that you'll be able to stream stuff to your tv through the device. do you know anything about it? >> we've talked about it but i think that it's possible and i think it's important to, for amazon to expand what they're doing for the tablet into the home. i'm not sure if it's this device or one at a later date. >> ken, thanks very much. when we come back, larry bossity will give us the ceo perspective on the presidential election, the jobs report from adp, a lot more to come. makes , or hires another employee, it's not just good for business. it's good for the entire community.

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the european recovery plan in the works, get the latest breaking details here and our guest host will weigh in at what's at stake for your defenses. >> if you want a company of shared opportunity and responsibility we're all in this together society, you should vote for barack obama and joe biden. pennsylvania congressman jason altmeier on what president obama needs to shore up votes. the next steps for the auto giant that could rev up its bottom line. the second hour of "squawk box" begins right now. ♪

>> good morning and welcome to "squawk box" on cnbc, i'm andrew ross sorkin along with joe kernen and becky quick. breaking news the bank of england keeping its key rate unchanged at half a percent, so that's something we have to watch today along with what's going on in europe. let's get you caught up on the headlines, the biggest one being an eventful meeting at the european central bank taking place this morning, the ecb will announce its latest rate decision in about 45 minutes followed by president mario draghi's news conference at 8:30 eastern, expected to unveil details of the sovereign bond-buying program. we'll have news the moment it happens. another key event, adp's august report on private sector employment that happens at 8:15 eastern with economists looking for the u.s. economy to add about 145,000 private sector jobs last month and samsung is saying it sold 20 million of its

galaxy s3 smartphones a little over three months, comes as the competition meets up of course with this week's product introduction by know yo, the lumia, not lumina, and apple expected to debut the iphone 5 next week. futures ahead of this it news later this morning, dow looks like it would open up about 84 points higher, nasdaq 7 points higher and s&p about 9 points higher. >> now back to charlotte, john harwood at the dnc, you have the story about -- >> we can't hear you with your mike and i see your mike but we can't hear it. >> we can see the mike but we can't hear it. >> let's get to john harwood in north carolina. talk a little bit more about what happened last night and maybe give us more color. we've been trying to find pictures of bob rubin adventure in the pool.

it didn't look like an inground pool. am i wrong? >> it was on the sixth floor of the hotel. >> it was in the middle of the, okay. just trying to get a visual going. >> in a room and it was so close to the door, entrance to the party that if you were looking down at your blackberry anybody could have fallen in that pool. it was very, very close and yeah, i wish i had a picture, too. there were i think there was at least one picture snapped but i couldn't, the person who snapped it wouldn't send it to me. >> there's a picture online of rubin at the party but you can't tell whether he's wet or not. >> reporter: this was after he got out, i promise you he was wet in that picture, but no, i saw a link to a picture this morning, i couldn't get it to come up on my blackberry so i have not seen that one but that's maybe the one. >> let's get to the less important stuff that happened

yesterday. >> reporter: bill clinton using the ability he has without peer in modern politics of framing an argument favorable to his side that makes the other side look completely unreasonable and he does it in simple terms average voters can understand last night. here is acally. >> my fellow americans, all of us in this grand hall and everybody watching at home, when we vote in this election we'll be deciding what kind of country we want to live in. if you want a winner take all, you're on your own society, you should support the republican ticket, but if you want a country of shared opportunities and shared responsibility, a we're all in this together society, you should vote for barack obama and joe biden. >> reporter: so there you have it. either you're on your own or we're in all this together, and

that's the formulation that democrats are counting on and that hug that you're seeing right now is what bill clinton and barack obama are counting on to give it a little bit more credibility to the incumbent, help him withstand a very, very close election against mitt romney, who is of course, had his moment last week and spent most of it going after president obama and this is the democrats' turn. >> john, there was a bit of speculation prior to the speech that bill clinton hadn't handed in a copy of the speech too early before he got up on stage. is that something that ultimately got vetted? >> reporter: a senior obama aide said yesterday at about 1:00, when we had a sitdown, me and my colleagues at nbc, said this aide said she had read the speech, so i don't know what exactly the vetting process is. we know with bill clinton that even when he was president, he was editing speeches right up until the time he delivered them, so maybe an early draft

was shared and then he kept working on it and he did go off script a lot last night, which is why he went almost to 11:30 at night. jon stewart taped "the daily show" yesterday and he taped it in the afternoon. his show airs at 11:00 p.m. and of course he knew what was going to happen so he's doing his monologue about the fact nobody's watching me because bill clinton has blown through that 11:00 and may blow through 11:00 and swallow up the kohl bert show, too. >> john thanks so much. i wish i had seen "the kohl bert report" last night, i heard there were funny jokes. and "the jon stewart show." >> we should have seen the cowboys beat the world champion giants. >> federer lose, roddick lost. >> roddick was in the afternoon. >> federer was at night.

serena just looked -- geez. her games are five aces, whatever, four, five, our guest host for the next two hours is larry bossy, great shirt. larry is retired ceo of honeywell, nonexecutive chairman of berkshire hills bancorps. welcome, larry. >> nice to be here. >> we all want to help people and live in a society where people help the underprivileged, they're almost platitudes no one could ever probably disagree with, that's what kind of irritates me by saying this is what our side believes it's implying the others don't but it would be nice to get there and help people unemployed. talking about it is one thing but letting people get to a point where they can be self-sufficient, then you're able to help someone else.

i don't think anyone feels like that they want to be on the receiving end of government largesse for the rest of their life. >> it's very difficult to get any real sense out of these conventions in the sense there's a lot of platitudes, people say a lot of different things but the facts are there's more people, unprecedented proliferation of food stamps which frankly in some cases it robs people of dignity, doesn't give them a chance to feel they're a part of the country, and i think that's terribly unfortunate, which means we've got to do more about jobs. >> right. was it overstating it to say we need u.s. business to be as competitive as it possibly can globally in this global environment, so that business can add jobs, people can have jobs, that raises the revenue that then goes to the government that allows the government to operate. if the government can't get revenue from the private sector,

where does the government get their revenue? you need a strong -- we're talking about the same things and leaving out these important points. >> you know, more than ever before the u.s. has to be competitive in business and as you know if you look at our tax code, we are not competitive in terms of those around the world with whom we are in competition, so i do think there are some good proposals on the romney campaign to make this country more competitive, make business more competitive, and by that, that will indeed provide the jobs that are essential to getting this country moving again, and it's going to be, with europe in deep recession and with china slowing, then it's ever more important that we get this economy going and so far hasn't happened. >> talk is cheap that we want to help everyone. we're there for you, with he feel your pain. it's not more noble, is it, to give someone charity than it is to give someone a job? for some reason we're listening to all of this and it seems much more noble and high-minded to go

into the giving field instead of giving someone a job and a job would be much better than giving someone charity. >> it would be but remember we're getting at a point in our society where there's a generation of people who expect to be given to, and i think that's a very different prospect than what i had for example, when i grew up and you grew up, and i do think it robs people of dignity to be on the take, if you will, as opposed to being productive but there are lots of people around the country who expect it and it's troublesome. >> collect i haveism i think is not the way that you run a society. individual opportunity is, but we need to guarantee -- that's where i come down on the side with the democrats, we need to guarantee individual opportunity and that's where you worry that education isn't standard throughout the u.s. and opportunity isn't really available for everyone, but if you have a person that can't earn their own success, if you give them all the tools necessary to do that, then we can stick with individualism, we don't have to go the european

entitlement state route. >> that's why it's crucially important that our companies are competitive, that we have education systems that provide everybody an opportunity to grow and to take advantage of what this country offers. it has a lot to do in my mind with the regulations, which hamper a lot of things, both individuals and corporations, so we've got to set the table in a way that allows people to be successful. >> everything should be viewed in the effect on jobs. >> if could you change one thing to try and get job creation off and running, what would it be? >> i'd make the u.s. companies more competitive by virtue of a couple of things, one, i like to see the repatriation of profits in a way that isn't so tax troublesome, so that money can get back into circulation. >> even andy stern said bring that back from abroad. >> you're talking about a one-time tax poll holiday or a new system? >> there's a number of proposals. >> any way to get the cash back.

>> in a way that isn't onerous and get it back. there's trillions of dollars outside the country, and secondly i'd like to have tax rates in a way that makes us competitive across the globe. >> here is a question for you. romney is proposing a 25% corporate tax rate, obama is proposing a 28% tax rate, it's not that different. >> no, not from the corporate perspective, the two tax plans are very different in terms of individuals as you know. >> right. >> also there's an alternative tax limitation, 30% tax on those making more than $1 million in the obama plan, so very different that way but from a corporate perspective, not a lot different. he also eliminates the accelerated depreciation inventory accounting which hurts corporations. >> you served on so many boards, you have so many connections, i want to talk to you about china and who is right? are we, do we just say wow, they are slowing but we're slowing to 7.5% and they're still a juggernaut or is it really

starting to be some serious concern with china? >> there's never been an economy in the world that doesn't have its ups and downs. >> is that all this is? >> this is all this is. protracted period of slow economic growth but i have no doubt they'll come out of it over time. >> that's different than the last five years. >> absolutely. the last five years have been boom essentially. this is going to slow. >> that's a middle answer. it's not that, we've for a while said yourself this whole status model, they've got it, they know exactly how to do it, they know, the government knows how to work with the private sector and spur investment and do this and they're never going to stumble. you're saying they're going to stumble a little. >> they had a big wage advantage, that wage advantage is going quickly. there's a lot more comparability in wages. >> they're getting cut by other parts. >> and the regional parts are in opposition to the central government. they're going to go through

turmoil but they'll come out of it right. i'm not ready to write off the united states and its growth either. we're going through a tough time but it will come back. >> we had mark farber on earlier, that asia he sees no growth in asia if you add it up collectively. >> mark faber has been known to be a doctor of doom, that's his view and i'm not anywhere near there. i think we'll go through a correction in china but it will come back and with the right policies we'll come back in this country as well, but there are a lot more tougher decisions to take today than before and i hope we have the courage as a country to make them. >> it is whacky the son of a big chinese leader, rexus ferrari, there's ten of them, all of the leader's sons have ferraris. >> that's different. they have their challenges but i think they'll come through.

>> if you've got comments, questions about anything you see here on "squawk" including some of the things larry and all of us were talking about, squawk@cnbc.com is the address, and follow us on twitte twitter @squawkcnbc is the handle. coming up if you doubt how politically divisive health care is, democratic senator lost his primary in april in large part because he voted against the health care law. andy roddick is retiring at age 30, he lost a four-set match to 2009 open champion wong martin del potro. thank you for not giving me a hard time. there's been another big upset at the open, men's top seed and five-time champer roger federer ousted from the semifinals for the first time since 2003, lost to six seeded tommic berdych

last night. bob... oh, hey alex. just picking up some, brochures, posters copies of my acceptance speech. great! it's always good to have a backup plan, in case i get hit by a meteor. wow, your hair looks great. didn't realize they did photoshop here. hey, good call on those mugs. can't let 'em see what you're drinking. you know, i'm glad we're both running a nice, clean race. no need to get nasty. here's your "honk if you had an affair with taylor" yard sign. looks good. [ male announcer ] fedex office. now save 50% on banners.

their number one priority was not to put america back to work, it was to put the president out of work. i hate to break it to you, but we're going to keep president obama on the job. >> that was former president

bill clinton speaking to party faithfulful. jason altmire, member of the blue dog coalition thank you for joining us this morning. >> thank you. >> so you recently lost in part because you voted against the health care plan. one of the things you hear over and over throughout the convention is embrace of obama care. is that the right tact given your experience and what's happened with you? >> i think politically, if you're asking that, it is the right tact. the democratic platform is, involves the economic improvement of the country, the health care bill is not part of that. it's enacted in law, the supreme court ruled two years into enactment and what's the choice that the democrats have? of course they're going to support the bill and of course they're going to talk about the improvements that the law has

made for seniors, for small businesses, for people who have chronic health care conditions. there are a lot of good things in that bill. >> sounds like you're making a good case for it. >> there are a lot of things at the time i thought could have been better, i don't want to rehash the vote that occurred two years ago, it's water under the dam but i do think that the democrats have a strong case to make, that what they did made a difference in people's lives. >> representative, i'm also curious, your view of this question, are we better off four years later, how do you think the party's responded to that question this week? obviously in the beginning of the week, some of the representatives of obama's administration didn't seem to be answering the questions so head-on, they seemed to have tried to answer it more throughout the week. >> the question is difficult because it's mixed, the reviews are incomplete. there are some things that are not where we want them to be. the unemployment rate is higher than it was when president obama took office but the gdp rate and

the growth rate has improved dramatically. we lost 6.5% gdp in the last quarter of 2008. we lost 2.2% in the first quarter of 2009. you've heard it a million times, we were losing 750,000 jobs a month, those are real numbers. >> right. >> we are a lot better off in those categories. but the unemployment rate is not where we want it to be. we haven't fully recovered so that's why the question is difficult to ask. you don't want to set yourself up politically because there are things that you can point to that aren't better where they were four years ago. >> representative, we have larry bossidy on the set this morning and he and other former ceos, board members said that obama is bad for business. make the case maybe to larry about why you disagree. >> i do disagree. i this i that what happened with the auto industry certainly you'd get a different story. you know the facts there. if you look at our relationship overseas of the trade agreements that have passed, three of them,

i believe three of them since president obama has been in office, if you look at the proposals on the economy, the stimulus, i think helped save what could have been a catastrophic occurrence, downfall of our economic situation in this country, small businesses, 18 tax cuts since president obama has been in office, there's a lot to work with there. >> jason, why do you think that it's a good idea not to embrace business in terms of a relationship. they've made every attempt to join the president in common pursuits and got no place, and basically he seems to demonize business. it's great for a country to, another country to represent business in a way that's helpful all over the world, as a matter of fact he's worked to the disadvantage of american business across the world so it's unclear to me why he's done it and i wonder if he should be reelected if that will continue in the next term.

>> i hear what you're saying and i agree some of the rhetoric is over the top. we all lived through 2008, we understand the root of the problem was on wall street, the wall street reform bill, dodd-frank is not perfect but i think it was the right, step in the right direction and the reason that you hear so much rhetoric about business and about wall street is because, look, that's what happened in 2008. >> jason, you know about fannie mae and freddie mac. >> the housing bubble that was 20 years in the making. >> they're run by the government the last time i looked, and they had a major role in terms of what this housing market did, so to think it was all wall street is just miscast. >> i'm not saying it was all wall street, i was just answering your question of why that rhetoric works. wall street played a role. i'm not going to let you get away with saying it had nothing to do with it. >> it was self-defeating to bash business and when business doesn't bring jobs back to 5%,

6%, it was like oh it wasn't my fault. he had this coming and it's clear it was unfortunate it was in his best interest not to focus on obama care for the first two years, should have focused on this, right? >> i think you're right about that, yes. >> representative we have to leave it there. thank you for joining us this morning. still to come on "squawk" this morning, one of the nation's best known names in the mun muni bond world. we're sitting on a bunch of shale gas.

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coming up, alexandra lebenthal, we'll find out if ballooning deficits are changing the name of the game and a policy decision from the ecb, coming up.

welcome back to "squawk box" here on cnbc. in the headline this is morning the bank of england leaving its key interest rate unchanged as well as the size of its asset purchase program, next up this morning, the ecb's rate decision coming in just a few minutes followed by what will widely be watched that news conference from ecb president mario draghi at 8:30 a.m. eastern, at that time he's expected to unveil details of this sovereign bond buying program we've been talking a lot about, and up next hour, the adp's august report on private sector employment and the labor department's weekly

look at initial jobless claims, all this ahead of the government's august employment report set for tomorrow morning at 8:30 eastern and it's going to be a very important number to keep an eye on. president obama set to accept his nomination for a second term at the final night of the democratic convention in charlotte, north carolina, following a rousing endorsement speech last night by former president bill clinton. our guest host is larry bossidy, former chairman and ceo of honeywell, he is also currently a non-executive chairman of berkshire hills bancorps. we've talked a little politics, talked a little china. we've seen the euro rally back to 125, 126. anything mario draghi can do to continue this momentum? is he already done it? >> i think whatever he is going to say is already in the euro and the real aspect of the announcement will be what conditions is he going to impose

on paortugal, spain and italy. all the central bankers want some conditions that they'll take the restructure to improve their economies in order to get this bond plan to go into effect and how severe and stringent they'll be remains to be seen. the germans are very much in favor of putting conditions on this bond buying, and at the end of the day, angela merkel and her german cohorts will decide how far the ecb goes in bailing out southern europe. >> when it's all said and done will europe behave more like germany or will germany just throw in the towel and just say, oh, c'est la vie, i'm going to lie on a beach? >> that's a great question. germany will do everything they can to stay where they are. they have the money in terms of the european union, among 17 nations. their economy is slowing as you know finally, after stay at 3.5% for the first part of the year, now down to 1% but they'll do everything within their power to maintain their strength.

>> what were you saying, to me, after our last discussion about the german government fully behind business in germany right now, and in a different way than you think maybe than other countries? >> they promote their businesses and for example if you're in an international competition it's not unusual to hear from a government spokesman, for example in germany, that supports the thrust, if you will, of their company, you seldom see that here in the united states. >> that's why i said in other countries. so you do see a difference between the german government and -- >> i do. >> -- obama administration. >> i do. that has not always been the case. in other words when i was working, we did have some assistance from the u.s. from time to time on big international contracts and at least putting good words in for us. i don't think that happens anymore. >> i think that you don't need an advanced degree or a law degree or you don't need to be a genius to realize how important business and the private sector

is to running a government, do you? >> you don't. >> what's the problem?! >> because it isn't recognized that way across our country anymore, unfortunately. as i mentioned a moment ago they want to demonize business instead of promoting it. >> government jobs are fine, firemen, teachers, all that, but it's the money from the private sector that pays for the government jobs. >> that's right. >> it always comes back to jobs in the private sector. >> you know, if it's so obvious, why don't you think this administration -- >> that's what i'm asking you. >> i don't know the answer. you think in a different way than we do. they think jobs are more important than private jobs. >> there are more important things. people tell me about the manhattan project and the internet and the 9/11 responders and all that, and i understand that. but to have a vibrant government you need a vibrant private

sector to pay for it or else it doesn't work. >> simpson-bowles takes the government employment down by 10% on day one, it should balance the importance of private jobs as opposed to those that occur in the public sector. but we have to have a broader recognition of that in terms of supporting our companies and any number of ways. >> germany is much more supportive of its -- they sound more, it sounds like german exceptionalism, not american. that's all we need is german exceptionalism again in this world. >> joe you got a situation where germany is in a different financial position than the rest of the countries in the eu at least in southern europe and the question is, they're going to defend all they can to protect themselves, and that is not going to necessarily be in the best interests of the rest of the union. >> why is the euro so strong at this point. you look at the problems that are there, even germany's economy is slowing down, part of

it is because of the strength of the euro. >> becky, it shouldn't be as strong as it is. i think it's the last couple of days in anticipation of this announcement coming from draghi this morning, but clearly in my mind it shouldn't be as strong as it is. the trouble is it's comparative. you look at our currency and the issues we have in terms of our debt and their deficit that doesn't promote a strong currency either so comparatively, it hangs in there. >> okay, we're going to continue this conversation, you're going to be sticking around. ford holding a major product event in amsterdam this morning. are new products really the answer to containing ford's losses in europe that are now expected to total over $1 billion this year? cnbc ace phil lebeau joins us with the answer and more. >> hi, andrew, this say big day for ford at least in europe. in amsterdam the company is giving reporters a sneak peek at 15 new models that it will be unveiling in europe, rolling into europe over the next five years. this is really the product

offensive they'ren plaing, they're going to be launching completely new commercial line-up over the next two years. while everybody says this is great on the product side the issue is on the cost side when you look at ford. look at the european losses, first half of the year the company lost $553 million, full year the estimate is for $1.5 billion in losses and by the way at least one analyst says it's closer to $2 billion and here is the issue, ford's plants over there, they have ten, running at 63% capacity in the second quarter, they clearly face restrictions in terms of closing those plants and that's really the issue that everybody wants to hear about, earlier today here is what ford's eco said about any possible plant closings in europe. >> we don't have anything to announce today but working with the stakeholders to continue to implement that plan, just like we have in the united states, but today, fellows, you know this is really about the products, because in addition to the production sizing, we absolutely want to be there with the freshest line-up as the

economy starts to recover. >> when it recovers is anybody's guess. most not expect this year or early next. european sales down 10% in the first half of 2012. the industry was down just 6.3%. ford has 7.7% market share in europe, down fractionally compared to a year ago, and when we talked with alan mulally, here is the question i posed to him, you look at shares of ford over the last year down 6%, what do you say to investors who are looking at the stock saying you're doing great in the u.s. china and asia are coming along but europe is the problem and guys, he said all we can do is continue to work with the unions, remember they face restrictions in terms of closing plants and try to bring down capacity as much as possible. we are not seeing any definitive news from word ford and i don't think we're going to see any definitive news for some time when it comes to what's going on in europe. >> this is larry boss id. i just wonder, with the economy that we read about every day in

europe being in a difficult situation. why would they be launching an initiative like this at this time? >> because they're getting killed by volkswagen and bmw, bmw coming down with the three series eating into the business that used to be going to the mondao, the best selling ford vehicle over there and the other side, folks wvolkswagen is goin to war with them in terms of pricing. so it's all about the product side, larry, but as we all know investors are focused on the cost side. >> okay. thanks, phil, appreciate it very much. coming up, we're just a few minutes away from the ecb's rate decision expected to hit the wires at 7:45 a.m. eastern. at 8:30, ecb president mario draghi's much anticipated news conference, we'll monitor the conference for details on the sovereign bond buying program. and president obama set to

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welcome back to "squawk box." checking the futures, we have green arrows across the board ahead of the big ecb division we'll hear about in a few moments. the dow looks like it would open up 75 points higher, s&p 8 points higher and nasdaq about 14 points higher. we are waiting for the ecb decision on interest rates. steve liesman is monitoring the wires for the ecb news. >> i should be looking at the

camera. not the computer. >> let's get perspectives from someone who knows a thing or two about the muni bond market joining us is alexandra lebenthal, a cnbc contributor, is that new? >> it's new as of about a year ago. >> then it's not that new. warren buffett recently announced or disclosed that he had gotten out of providing insurance effectively for municipal bonds, a package that he had bought in 2007 from lehman brothers. what does that say to you about the munie bond market right now? >> it's a little bit hard to interpret without getting more information from him directly because it certainly could be his just saying this isn't a business that provides the type of margins we want to get in a business.

it could be him saying i don't want to get involved with the cities and states and don't want to essentially pay for it in the side. >> you are still not on that side. >> i am still not on that side. >> because? >> because i have seen that many major municipalities, states, cities have done what it takes to make sure that their budgets are balanced, they've sat down with pensions, they've cut spending, they've continued to pay their bonds and as much as the economy still has room to grow as we all know, state tax receipts have continued to increase. >> taxes, could have a huge impact on the future of munis, and they may not actually be, may actually -- >> they left their benchmark unchanged at 0.75%. deposit facility also unchanged at zero. there was not really serious talk and that was one of the things discussed at jackson hole. >> we're not going to hear anything more on the sovereign

bond buying program until 8:30, is that the expectation in. >> that's right. it will come out we believe in a statement, they haven't announced these nonstandard unconventional measures in the policy rate announcement, at 7:45. >> steve was your crowd expecting the rahity to go from 75 to 50 basis points? >> my crowd, the guys i play music with or the guys i talk economics with? which guys are you talking about? >> probably the latter. >> the guys i play music were hot and heavy on the 25 basis points. the economists expect over time the fed and ecb to go on the parity. they think the european central bank will get down to parity. >> what are they waiting for? >> a good question. maybe they don't want to do double barrelled standard monetary policy, conventional methods and unconventional method, they're waiting for one. i also think maybe they want inflation to cool off. remember this is a bank that puts the current rate of inflation and the forecast of

inflation ahead of all of the decisions. so it's doing that and with the recent surge in energy prices maybe they felt uncomfortable cutting the rate. >> they want to do all of the unconventional things that are out there? >> there's a lot of talk among my people that draghi has to bring the rate down, the euro has to fall to make the peripheral parts more competitive and in addition -- >>feldstein wrote an article about this. >> he's part of my crowd musically. break it down to parity with the dollar, this will, by the way, help german exports -- >> he's in the mouskemousketeert is your band? >> the moon cussers. >> the muni cussers? >> muni cussers! >> we hate muni -- meredith --

>> what's interesting is joe has not run out of ways to mock the name myself band. >> do you know how many things start with "m" and two are words. >> it's infinite but quickly, the idea that the euro would go down to parity with the dollar and some talk that draghi should really be talking down the euro, that's a difficult position for an ecb presidents who mandate is inflation because that would stoke inflation a little bit. there's an expectation amongst serious people not musicians but economist, former central bankers who think that the euro needs to fall, and will fall. what's interesting is as soon as i learned of all these expectations out there on the part of these people, the euro has essentially strengthened. >> jim o'neill from goldman sachs has talked about that. >> it's defied expectations. >> when the euro was launched it we was at parity with the dollar and it would be good for the situation around the world.

>> i worry that strategy on the part of europe would be effectively helping the european economy at the u.s. economy's expense, in that -- >> i think that's a fair concern. >> one of the things that's been, one of the better parts of the economy has been the export sector manufacturing. >> i agree. >> and i would hate to see that come off because europe needs to rebalance itself. >> jim o'neill also -- >> thinking of best interests, they might well do it. >> -- mentioned that would create a problem with the yuan. it would create a series of problems. i don't know that the ecb should be so concerned about that. take a look right now the euro at $1.2633 on the news. >> it strengthened. i think it's defying this, i think there's a bid out in the market for a weaker euro and when we don't get these things that people expect to happen at least over time it tends to strengthen it and of course when bernanke starts talking about additional qe, when the fed starts talking about that, that also tends to strengthen the euro and weaken the dollar. there is a contest in the world

for the ugliest currency. that's really what's going on. there's no inherent strength out there in any of the currencies i don't think except for maybe the canadi canadian luni. >> thank you, steve. let's get back -- i don't know how we can segue but i want to know about taxes. what do you think will happen, meaning all of the tax plans or some of them could have a huge impact. >> some of them could have an impact in the form of actually taxing municipals, which is something for decade tz ts has to fight against, local issuers saying you can't raise our cost of borrowing and tax plans that would increase taxes that would make municipal bonds more attractive because if you are in a higher tax bracket and you don't have to pay a tax on your municipal bonds it's like getting a greater return from a taxable investment. >> what is your expectation? >> we have $16 trillion in debt, right, alexandra? taxes are going up. >> my expectation is the taxes

are going up, and that the argument will be successfully made for the most part that municipals should not be taxed. now, i say for the most part -- >> what is the lobbying arm that will make it on behalf of states and municipalities? >> the lobbying is going to be the gfoa, the government finance officers association, with help certainly from the industry, but it's really their argument to make because it's their budgets that will be affected. now, there are always loopholes that need to be closed. there was a story yesterday about the continuing cost of stadium financing, on taxpayers, when it's really private activity, and that was supposed to -- >> going on dallas, huge issue that was. >> dallas and the giants, jets stadium is privately financed, so there are certainly cases where that's not done, but that was supposed to have been taken care of in the 1986 tax act, and the issuers have found ways

around that, making the argument that, well, it's still bringing economic activity to the area and it's something that we need to to to generate our economy. >> alexandra, how strong is this lobby that's going to be pushing to retain the tax exempt status of municipal bonds? >> it will be strong. i mean, it's been effective over the last number of decades. >> most haven't been but this one has? >> going back to the 1970s, when tax exemption was on the table, and certainly 1986 with senator packwood, web that was a big issue and it's been successful. could anything happen, of course but i don't think so. >> because federal government finally connects the dots. they didn't about a year ago, when obama was going to take it, and then someone explained to them it will be harder for the states and the municipalities to raise money and they go oh, oh, yeah, geez, someone should have -- >> simpson-bowles proposal. >> bipartisan. that will just add to the federal government having to

give more aid to the states after all. >> it was part of the ravage-volcker commission you can't have this between the states. >> the feeling is you're sticking it to the rich, all of the state and local governments are depending on lower rates to be competitive. >> absolutely. it's financing -- >> you want every state to be california? >> it's financing the subway that helps a lot of people get to work and not all of them rich people. >> thank you for being here. >> it's part of an important thing in america where we do not bail out our cities and states, and by keeping those rates low is the best way. >> coming up, ecb president draghi's news conference at 8:30 a.m. about the sovereign buying program and early read on jobs at 8:15 a.m. eastern, get the adp private payroll numbers. bob...

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coming up an update from the democratic national convention from dnc chairwoman debbie wasserman schultz, plus we'll get an early read on tomorrow's jobs report, the adp private payroll numbers are due out at 8:15 eastern, and recovery plan for europe we'll bring you details from mario drgie even his news conference set to start at 8:30 a.m. eastern. eds manufa. machines, tools, people making stuff. companies have to invest in making things. infrastructure, construction, production. we need it now more than ever. chevron's putting more than $8 billion dollars

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the ecb's plan to fix europe. >> we know, big ben. >> parliament. >> ecb president draghi set to speak at 8:30 a.m. eastern. we'll bring you live updates from the news conference. there's not a single job in in town, there is nothing, nada, zip. >> yeah, unless you want to work 40 hours a week.

>> we're going to get the adp private payroll numbers at 8:15 a.m. eastern and the closely watched weekly jobs claims at :30, roger altman joins us. and the democrats making the case for president obama. >> we believe that all of us in that together is a far better philosophy than you're on your own. >> before the president takes the stage tonight we will talk to the dnc chair, debbie wasserman schultz. the third hour of "squawk box" begins right now. ♪ welcome back to "squawk box" here on cnbc, first in business worldwide. this is really bad music. i'm joe kernen -- >> i don't mind it. >> really? it might be new stuff.

i'm okay with it. >> becky quick and andrew ross sorkin. our guest host, larry suggested that song, larry bossidy, former ceo and chairman of honeywell and a cnbc contributor. checking u.s. equity futures been up all day, indicated up 81 points, could get better or worse depending on adp and what mario draghi says at 8:30. it's a day where -- >> jobless claims at 8:30, too. >> i would keep watching. >> i would not go anywhere. the ecb left its key interest rate unchanged at 0.75%. investors looking forward to details of the ecb sovereign bond buying program, we're going to get details on that program during president mario draghi's news conference, that's expected to start at 8:30 a.m. eastern, but of course sometimes it gets a little bit delayed. the august adp report will be released at 8:15 eastern time. forecasters expecting it to show the u.s. economy added 145,000 private payrolls last month and

of course that number is important in terms of how people going to predict what the ultimate number will be tomorrow. navistar is cutting jobs and suspending future earnings guidance because of what it's calling uncertain industry conditions that follows a bigger than expected fiscal third quarter loss, now it's in the midst of a voluntary separation program and overall workforce reduction aimed at saving $80 million a year and the truckmaker launching a review of all non-core businesses. former president bill clinton making the case for president obama's re-election at the democratic national convention last night. >> no president, not me, not any of my predecessors, no one could have fully repaired all the damage that he found in just four years. but he has laid the foundations for a new modern, successful

economy, a shared prosperity, and if you will renew the president's contract, you will feel it. you will feel it. >> president obama is set to speak tonight, for more on what to expect from the president we are joined by representative debbie wasserman schultz, she is the chairman of the dnc and congresswoman, thank you for being with us this morning. >> you're welcome, good to be with you. >> we heard former president clinton laying out the case last night. what is the task that president obama has to deliver on tonight? >> well, we've been building an amazing crescendo at the democratic national convention this week towards president obama's acceptance speech of our party's nomination, and what he'll do tonight is unlike what we saw last week from the republicans in tampa is he'll have an honest conversation with the american people about where we were when he first began his presidency, inheriting an economy that just lost 3.5

million jobs in the previous six months and hemorrhaging 750,000 jobs a month when he took office and now thanks to policies that say that if you work hard and play by the rules, you should have an opportunity to be successful, we've had 29 straight months of job growth in the private sector and resurgence in manufacturing and yesterday we got great news that we've had the most automobile sales in terms of numbers, so we're moving in the right direction and he'll say we've got a ways to go but as president clinton made the case last night, do we want, the question is and the clear choice is do we want a president who believes that we're all in this together or do we want a president who is going to implement policies like mitt romney would that says you're on your own? that's the clear choice. >> representative you lay out some very important points, though, it's the economic numbers that continue to come in that people are watching so closely. >> absolutely. >> it has been a mixed bag. tomorrow we'll be getting a very important jobs report and i guess my question for you is, expectations are about 125,000

at this point. if that number comes in well below or well above, what's that going to mean as we finish hearing from the president tonight as we head into this tomorrow morning? >> well, presumably tomorrow we'll get a report that says that we have had now 30 straight months of job growth in the private sector and i think you can clearly say and the case can be made as we've been making throughout this campaign that thanks to president obama's belief and his policies, that say that if you work hard and play by the rules, if you, in this country, should give everyone a fair shot and a fair shake and we should have everybody pay their fair share and have a balanced approach to making sure we get a handle on our deficit and we focus on creating jobs and getting the economy turned around and do it in a way that helps the middle class and working families, not like mitt romney would, which would increase taxes on the middle class to pay for more budget-busting tax breaks for millionaires and billionaires. repeatedly we've seen through this campaign that the choice is

very clear, two very different paths and different visions laid before the american people, and you know, i know for me as a mom having listened to michelle caruso cabrera michelle obama on tuesday night, she spoke to me and i want a president who understands every child in america should have a president who wants to make sure they can achieve the american dream no matter what station in life they come from. >> you talked about a bunch of points. couple of times you mentioned the jobs growth we've seen for many months in a row but the president himself and president clinton last night both laid out we are not where we need to be in terms of jobs. >> absolutely. >> talking about 8.3% unemployment. >> it's the number one issue. >> tonight will we hear specific details about what the president would do in terms of job creation? that was the criticism the republicans last week about the democrats, we did not hear specifics. will we hear specifics tonight on how to get people back to

work? >> you'll hear the president lay out his vision and some of what we've already seen from the president obama like the american jobs act that the republicans have refused, my republican colleagues in congress have refused to take up, and left more than 1 million jobs on the table. we'll hear from president obama about how we can make sure that we work together to create jobs and get the economy turned around, and that we have a ways to go, but that we've come really far from a place where we were in a crisis that our economy had faced that it was about to go over a cliff, thanks to the failed policies of the past, and president obama will talk about the choice, he'll talk about do we want to go back to policies that nearly crashed our economy that allowed wall street and big banks to run over consumers, and not have everyone in america have an opportunity to get a fair shot and a fair shake, and play by the same rules.

he'll go ahead and make that clear case tonight. >> do you think tonight in the process of his discussion he'll comment on the fact that the debt has grown $5.4 trillion since he's been in office, and what he'll do about that if he were to be reelected for another term? >> well, president obama has repeatedly laid out the case that we need to take a balanced approach to deficit reduction, unlike the romney-ryan budget and i sit on the budget committee so i had a front row seat to their vision, their approach is let's slash, take a hacksaw to the budget, slash and burn key investments like education and health care and research and those are things that would short circuit our ability to outeducate and outinnovate and outcompete the rest of the world. we've had economic experts testify in the budget committee if you cut too much too fast you'll slow or stall what's already we know a fragile recovery. president obama's case is that we should take a balanced approach to deficit reduction,

ask people who can pay a little bit more to do so and make responsible cuts that don't short circuit our future. >> debbie, thank you stretch for joining us this morning. >> you're welcome. >> appreciate it. >> more from guest host larry bossidy. i'm going to let you just, where do you want to go? you want to talk about the interview? i've heard a lot of that before. >> yes. you have. >> you want to talk about that? you want to talk about draghi? where do you want to go? >> no, i think that this question that's going to be debated over the next 60 days as to what direction the country should go in is pivotal to the future of the country, as others have said, except that they're different viewpoints how to get from here to there, and i do think that the current administration is trending more toward what the european model is, and we've seen the results of that, i think we wanted to depart from that drastically. i think we want to promote our corporations and generate jobs and improve our education system and we want to do it as we get

closer to a balanced budget. we're not going to get a balanced budget overnight, four years of $1 trillion deficits. we can't cut too quickly for make the economy worse. we have to have a program that gets with that and deals with the debt and i think i hope that those subjects will be debated in earnest in the next 60 days and the american people will decide but clearly in my mind i think the romney program is far more productive. >> i wonder if it resonates when you say things that i represent a party that wants every child to have an opportunity to succeed in this country, and it just makes, so the other party is apparently i guess -- >> i'm familiar with it, too. >> how about that we were -- i didn't realize, i thought t.a.r.p. got the financial system back to the point where, i didn't realize every person that comes out and says we were on the precipice of a depression without that $800 billion stimulus, were we on the

precipice of a depression without the stimulus program? >> no, we were not. as a matter of fact you can argue and i've heard the arguments what impact the stimulus programs have had, in other words, have they really made a difference. to be fair -- >> i think they did a lot of teachers and firemens jobs. >> it may not have been worth $800 billion, but you look at t.a.r.p. and in october and march of 2009, you remember how low the stock market was going and freaked out people were and people announced the stimulus. i'm not saying it worked as well as it should have but to argue it had nothing -- >> what was bernanke doing at the time. >> give credit to what bernanke was doing. >> andrew, what would have happened -- >> i'm simply saying that nothing is black and white. everything is gray and invariably probably a combination of t.a.r.p., a combination of bernanke and possibly a combination of some

of the other things that happened. >> all of these steps and we stayed above 8% for 43 months for the first time in history and it's all because of policy. >> howard dean said it, when he got into office, 600,000 jobs were being lost. >> howard dean was a much better stew pardon of finances than obama. lead from a new position of strength. together with bank of america, they have access to more resources than ever before. a steadfast commitment to help you achieve your financial goals in life. that's the power of the right advisor. that's merrill lynch. that's a good thing, but it doesn't cover everything. only about 80% of your part b medical expenses. the rest is up to you. so consider an aarp medicare supplement insurance plan,

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welcome back. we cut things off way too early. we had five seconds, steve, before the adp numbers. here he is with the numbers. >> adp reporting that job growth in august was 201,000, reasonably above expectations of around 140,000. the estimate for non-farm payrolls for friday is 125,000. the private payrolls from reuters is 138 so that's going to suggest perhaps some upward revision. just some of the data here, small business up by 99,000, medium sized business 86,000 and large business 16,000. i also think it's interesting, goods producing sector up 16,000 and i believe, i'll double check it but the third month in a row of construction worker gains. >> wow. >> they were up --

>> who knows if you were an s&p futures trader i'd be like okay, that's good, no, wait a minute, it's bad, qe3, what? buy or selling that? >> yes. no, i mean i don't know, because there's been this push me, pull you market between better economic -- i've maintained for a long time -- >> they did what you said, they bought, they sold, they bought, they sold. >> the market wants growth. if the market had to choose between artificial qe and job growth -- >> you look at oil and you know, look at oil, the dollar, gold. >> the day traders want a little profit and a balanced book at the end of the day. that's what they want. let's bring in somebody we want to know more what he wants from the economy, joel prakin, put this number together for adp. joel, you guys revised up the prior number 173, which is almost exactly on the private

sector report from the bls last month, 172. >> right. >> i guess the most important question, is job growth back here? >> i think that it's sequentially improving from a lull in the spring, and that sequential improvement from month to month suggests that some of that spring lull was seasonal factors in nature and some of it might have been a temporary euro related seizure of confidence in hiring. i'm encouraged by today's number but as i said month after month when i've come on with you, we still have a long ways to go and given our macro forecast for the rest of this year into next year, hey, i'm not expecting a further acceleration in these monthly employment gains. >> you nailed it last month, joel, but then the month before, it was off by like 1 t00,000 -- there's a gufus adp and a gallant adp. which one are you this month?

you never know. >> i was the gallant one last month. >> you were. >> i'm feeling like the gallant one this month, too, but hey, sometimes the data comes out in a way that supports the adp numbers, sometimes it doesn't. i like to remind listeners all the time that this is a statistical series that has its own, you know, its own issues as does the numbers from the bls so you need to look at these over a period of time, and what you do see when you look at the adp numbers now over a period of time is that following a lull in the spring there's a gradual reacceleration that's promising. >> i liked gufus more, gallant was always a goody doing what mommy does all the time. >> what do you expect out of tomorrow's jobs number, even though they don't move lock and step. if you see a big beat you'd start they'd tick up the numbers from 125. >> i don't mean to punt on this but there are three groups of guys who say this is a best

possible leading indicator for the jobs report, guys who say it's part of their model and guys who throw it out. >> i ask that because the street's expectations have been relatively low, 125 versus the 163 from the month before. does this change that and make it a higher bar to have to jump over? >> i think there is going to be a higher bar, some will revice up and this will result in a higher estimate for tomorrow. joel, this number here -- >> i really agree with that, steve. i follow very closely all the respondents that are in the consensus surveys. >> right. >> and there will be a small group that moves in the direction suggested by the adp numbers as i think is appropriate but there will be a large number of people that stand pat and so there will probably be a small nudge in the consensus numbers in this direction. >> joel, let's talk about 201,000 job created and what it means for the unemployment rate. >> i think that would be enough to suggest the possibility of a slight decline in the unemployment rate but it depends on what happens to the civilian

labor force. >> that's been very volatile the last several months? >> very volatile trending down over the last several years. if we see a gain of 200,000 in established unemployment tomorrow, and not a big decline in government employment i think it's possible the unemployment rate could tick down a tenth. >> we had jim bullard not too long ago, the st. louis fed president. i got to talk to him offset and i don't think i'm breaking confidences, talking about the seasonality of the u.n.s and downs in the economy. he said look stuff doesn't happen three years in a row by coincidence and here we are once again, been through a strong winter, a decline in the springtime and then we reaccelerate in the fall again, to what extent do you think these numbers are a product of the seasonality problem we seem to be having? >> you know, i know there is that pattern, but we and others i think have looked at whether there is an echo effect from the great recession that shows up early in every year.

we haven't found a consistent pattern. if you look over the last couple of years you see in the springs, there have been reintensifications of concern out of europe, and i don't think you call that a normal seasonal factor. that's an idiosyncratic move in uncertainty that's had an impact on the economy. i think this last winter was particularly warm and could have had the effect of accelerating employment in the winter and some payback in the spring and moving up to what the baseline was before. >> joel, joe made a equip befqu maybe there's some truths in that. >> there's always some truth in myths. >> people employed part-time for economic reasons and working one hour. there's been a larger percentage of part-time unemployment in the jobs numbers. to what extent do we know are these people who are working for one hour during the week and reported as employed? how much does that change the

reality of whether or not people have real full time jobs? >> well, there is an issue about whether the reported unemployment rate fully reflects the degree of underutilization in the economy so there are alternative measures of unemployment that are much higher than the reported unemployment rate. as long as all of the measures moved together roughly in some sort of lock step they all pretty much tell the same story and i think that is the case here. >> joel, give us your growth outlook for the third quarter and for the rest of the year. >> it's getting a little more complicated. >> yes. >> abstracting from any effects of the drought, we put gdp growth around 2% over the second half of the year but we recently did get the department of ag forecast for crop yields over the second half of this year and it's very, very glum so when we released our forecast earlier today we'll show a markdown over the second half of the year to gdp growth closer to 1.5%, incorporating the effects of the growth. >> half a point from the

drought? >> very substantial decline in gdp produced in the farm sector, now that we've seen the crop forecasts that have been updated recently by usda. >> i've been tracking that among a lot of economists and this is one of the biggest markdowns i've seen. >> remember, steve, remember, steve, we've had two consecutive yearly declines in agricultural output here in the u.s. and if in 2013 we go back to a more normal crop yield there could be a significant positive contribution to gdp next year so it is getting more complicated. underlying growth abstracting from that around 2% for the second half of the year, maybe the same in the first half of next year moving up higher than that the at the end of next year. of course we have to worry about fiscal drag, what's it going to be. >> that's another factor. >> the bls numbers? >> i don't know, i've seen a few things that it could have some impact on the bls numbers but i this i it was localized in the new orleans -- am i right about that, joel, it was really a

local event? >> we have some experience from this dating back to katrina, which did have a measurable effect on some of the unemployment numbers. i think isaac will have essentially no effect. >> that's not the big event of the morning, right, joe? >> thanks to steve and joel prackin. at optionsxpress we're all about options trading.

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more jobs numbers still ahead. we are just a few minutes away from the weekly jobless claims and we're waiting for comments from the ecb president mario draghi. we'll monitor the news conference and bring you the updates. right now as we head to a break take a look at the u.s. equity futures about 92 points above fair value, dow futures strong all morning long. we'll see how it hangs in with the next news. [ male announcer ] what if you had thermal night-vision goggles, like in a special ops mission? you'd spot movement, gather intelligence with minimal collateral damage. but rather than neutralizing enemies in their sleep,

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welcome back to "squawk." we're a few seconds away from weekly jobless claims. rick santelli standing by at the cm negotiation chicago. the numbers, please. >> reporter: the numbers are initial claims move from a revised 377,000 shaved 12,000, we're now at 365,000. so we originally released that number at 374, up to 377, current read at 365. of course that's going to be perceived as an additional helping of good news, because we all know it's about jobs, jobs, jobs, and we've created more than we anticipated, revised last month to create more than we had previously released, and of course everybody's going to be cheating on their homework because everybody's estimates for tomorrow are going to rise a bit, not on their own research but on the momentum of adp and

i'm not saying that's a bad thing but everything will be jostled and as i'm speaking i'm sure mario draghi is trying to clean out that bazooka and show us what was inside. if the euro currency is hovering at the best levels in seven or eight weeks, so at least from my vantage point it doesn't look like there's anything detrimental coming out of that press conference which probably just began. interest rates definitely moved higher, right as that number was released at 8:15 eastern on adp, several basis points on the long end, back to you. >> okay, rick, thank you, a nice segue to our next conversation. >> we have been monitoring those comments from ecb president mario draghi. let's get to steve liesman for an update. michelle caruso-cabrera also has been listening in. steve, give us the quick news you're hearing. all right, michelle? >> oh, am i on here? >> yes, you're on steve. you're up. >> he's just talking about what he's calling omts, outright

monetary purchases, omps, to address severe distortions of government bond markets which he say originate from severe distortions and unfounded fears and i'm just going to listen to the details right now but he's just now saying that the governing council agreed upon what he's calling the modality is the ways they're going to do it. we're listening right now. >> steve will be listening to some of the points. michelle has been listening in, too? >> hi, guys. while steve was talking something else he said was a fully-funded back stop that you can translate that probably to the unlimited part, about the unlimited buying so that's going to be one of the key things, fully funded meaning they're all in. >> one of the points, michelle, that idea of the governing body signing off on this, is that to answer any of the doubts we had about the bundes bank? >> absolutely. the fact he's saying this and

ollie rend and juncker were there as well. >> we'll continue to have michelle listen in on this, steve is listening in on this and bring you some of the updates as they come in. as rick was pointing out we have seen the euro rally on the speculation about what we've been coming, the leaks that have gotten out beforehand. the euro last check was above 1.26. the adp report came in at 201,000er have success the 140,000 the street had been expecting, we just got the jobless claims down by about 12,000 to 365,000, and we've continued to watch the futures build on all of these gains. at this point you can see the dow futures last time i looked were wetter than 100 points above fair value, it's been strong all morning long and the economic news has not disappointed. we talked about whether or not traders would like to see the strong economic numbers coming in and worried if that takes qe3

off the table. the futures at this point about 90 points above fair value. >> they were 85 before. >> i think steve has something now. >> quick, draghi told us he's going to read two separate releases right now talking about the economic assessment of the board so he says there's two other releases coming out, they've addressed the collateral issue, in other words, what you can bring to the ecb for funding and he said he's going to read a press release with details of the decisions taking on the bond purchases so we'll have those i think in a couple of minutes after mr. draghi gets done providing the economic assessment of the ecb. >> okay, steve, thanks. coming up more headlines from ecb president mario draghi's news conference and roger altman's take on the european recovery and his expectation of tomorrow's jobs report.

all right welcome back, everybody. the ecb president mario draghi has been continuing to talk. we have hey steve liesman and michelle caruso-cabrera listening in. let's get back to steve for some of latest highlights. >> mario draghi still going through the economic assessment, downgrading growth, saying growth on the downside and talking about inflation which is expected to be at 2%, and then to fall next year, but he is saying that, again, repeating the idea of conditionality, that

the governments have to apply for these programs. they are necessary conditions, he says, and the thing you want to learn, guys, i think the abbreviation of the day is going to be omt, outright monetary transactions, what they're calling this, separate from the smp, which was the prior program and we'll learn the details coming up as soon as he's done with the economic assessment of these two programs. we'll get two different press releases in addition to the economic assessment. we'll hear what the details are of this bond purchasing program, which is going to have to be conditional upon applying for, to the rescue fund and the second is new collateral rules for bringing collateral to the ecb for funding, we'll continue to monitor. >> we've seen omt and mo -- >> we'll have to figure out the right abbreviations. >> opm. >> omg, i see that from my daughter all the time. >> good headline, omg, omg. >> omg exactly, roflfamo.

>> it's opm. >> other people's money. >> michelle caruso-cabrera you've been listening on this, too, part of what's been interesting is a lot of inflation is due to what's coming from oil as well, talked about rates. >> michelle said wtf, winning the future. >> i did say that inflation is expected to stay above 2% in part because of the energy situation. i would just add to what steve was saying, what we're going to look for, for clarity, he said fully backed stopped. what does that mean? how much money does that mean and also if they're going to start purchasing government debt again, where are they going to be in terms of seniority? remember the greek investors who bought greek debt lost money, but the ecb did not, and that could become problematic, and self-defeating if suddenly they start buying a lot of debt and people think wait a minute if spain does ultimately restructure and i'm below the

ecb i'll lose even more so it could be disincentive to buy. i'll sure we'll get questions about that. >> part of the expectation leading into this, michelle, part of the reports leading into this is that it would be sterilized purchases, meaning for everything they bought, they would take some money off the table somewhere else. they're not printing money. >> exactly. i'm sure he'll be asked about that. the leaks are clear it's sterilized purchases, that would be another huge leap and another battle i think with the bundes bank just purchasing the securities i think is a big step at this point. >> i just want to point out that in the last press conference a month ago draghi said the issue of ecb seniority would be fully addressed i believe. >> what does that mean? >> it sounds to me like they're going to take a subordinated position on some of these issues here and the issue of sterilization, i'm told is less of an important development in that the sterilization is sort of i'm not sure charade but

accounting fiction that doesn't tie up liquidity so much. >> what does that mean, steve? >> it means they put it in a way that doesn't really soak up liquidity from the market. it's a one-week sterilization program that really leaves liquidity in the market, so the idea that it's going to be sterilized i think is less important from a market perspective than people point they get out there. >> would they be printing money? it gets back down to what they are tell the germans and how the germans feel about the whole program. >> that's right, ultimately they're going to be adding reserves and increasing their balance sheet, but doing something that sequesters it for like a week and makes it available. >> and all bets are off when it comes to money? >> it comes back to the ecb as collateral. >> obviously still a lot of things that are happening, a lot of headlines. michelle and steve will continue to listen in as well. >> becky, i know the germans were very interested in sterilization and i can't believe they're not going to do it and by that i mean they're just going to drain funds from the marketplace as a way to

avoid printing money and i don't know what he said, but that certainly was the expectation going in. >> so you could see some pushback if that's not the case from the germans? >> yes, i can. >> for more on the european recovery we bring in roger altman, former deputy treasury secretary and chairman and founder of evercorps partners. is it a work in progress, roger? >> is the question is this a recovery? >> pueuropean recovery. >> hi, joe. >> hi. >> i think that this decision by the ecb to enter the secondary market and purchase or potentially purchase weaker sovereign paper could be a big step, and i think it's a good step because if you look back to what the united states did in late 2008 and early 2009, the

watch words were big, powerful and fast and i think innovative and i think this relatively innovative step by the ecb in terms of what it's otherwise been doing over the past year or so makes sense, but one of the key questions is conditionality. as i understand it, the ecb will only acquire for example spanish sovereign debt, if spain applies to the rescue fund, the esm for a primary loan, for a direct loan, and accepts the conditionality in terms of internal reforms within spain, fiscal reforms, banking reforms, that would be tied to that direct loan, and watching the dropoff in for example spanish yields and italian yields in the short end over the last couple of days, including this morning, one wonders whether spain and others will actually apply for

direct loans or whether as we've often seen in monetary crises the appearance of a big monetary weapon, means that it doesn't actually have to be used. to me that's an interesting angle on this. >> roger, larry bossidy, how are you? >> hi, larry. >> the spaniards were rejecting this premise. they didn't want to apply to the esf for a loan but rather wanted the bonds to be purchased first and then have a discussion about what the conditions should be. you think that will hold up in terms of these discussions? >> well we have to see what mr. draghi exactly says, and as we've all heard over the last few minutes he's speaking right now. but my understanding from -- >> here's what he's saying right now, "bond purchases may be terminated on no compliance." so if you don't comply with our stringent expectations, we're going to stop buying them. >> that's what germans wanted that. >> so the question underneath that, becky, is, if you look at

how far short yields have fallen, for example, for spain, are they going to proceed and actually request a direct loan from the rescue fund, which they haven't yet done, and accept the conditionality in terms of reforms, which would be tied to that direct loan, or are they going to see these better yields, continue to finance in the open market, and just allow this weapon, the ecb proposal to acquire sovereign paper in the secondary market to sit on the shelf and let the market look at it. >> roger, you're at the dnc, and it's been a fascinating, one thing to watch, and i'm asking you this question because you were there in what a lot of people are nostalgic for, the good old days of the clinton administration, and the democrats fumbled the question initially on, are you better off, and i think it's hard to answer it, because you've got a right track/wrong track of plus

32 points, i think on the wrong track and you have' got 8.3, over 8% for 42 months and i was thinking, they finally came up with the answer. if you go back exactly four years to where we were at the height of the financial crisis, you are indeed better off. but let's say you go back eight years of the bush administration, averaged 5.2% unemployment, go back to the clinton years, the eight years of the clinton years, how many years can you go back to where you say you know what? we aren't better off. we're worse off, and we were promised a post partisan age where we weren't going to have this divisiveness. i don't remember it ever being this ugly, we're nowhere near a post partisan age. other than exactly four years ago, what periods are we better off than right now? >> there's a lot of questions in there, joe. >> just answer a few. >> i'll take one or two of them. first of all the obvious answer just in terms of the calendar is that if you compare where the united states economy was on the

day that president obama first raised his right hand and took the oath of office. >> that's the answer they came up with. >> of course we're better off but it's not the answer they came up with. it's just a fact. there's a day on which president obama took office, off the top of my head it's january 20th, 2009. >> you talk about one point in history that you can say we're better off than, you look at any other point and basically we're worse off, so that's why it's such a hard question to answer. that's why the maryland governor had to admit no, we're not. let me get to steve liesman for one second, something is breaking, roger, he's either going to break it or fix it, i don't know. >> a combination of both. draghi giving us three elements of the plan very much expected, no quantitative limit set on the size of outright monetary tranci transacti transactions, two, the euro system will clarify it expects equal treatment with the private sector so it won't be senior to the private sector and three, sterilization, it will all be

fullysterlyize e fully sterilized and he's saying liquidity will be fully sterlyized. in the programs they are saying imf assistance will be sought for conditionality and for monitoring so they're not shy about bringing in the imf and the key is no quantitative limits set on the size and equal treatment as to seniority. >> to the germans' concerns, conditionality will be attached to the purchases and the bond purchases may be terminated on no compliance. >> let me tell you, he spoke that word in capital letters termination, i have to tell you, becky, when he said that, that it will be terminated if we a, reach our goals and bf the company were to go astray from the goals in the target program. >> michelle? >> i add to that they're also extremely transparent about what they're buying, going to publish on a monthly basis the countries from whom they bought and the current values of the bonds. that was a big mystery during

the greek debt restructuring, how much did the ecb own and what price point, et cetera. >> it's also worth pointing out, remember, there was this notion out there that they were going to set caps and rates and that's not part of what's being said here. so the way you'll learn about what the ecb is doing is through the monthly transactions and whether or not that's as transparent as it ought to be is an interesting point to make. >> thank you, guys. let's get back to roger quick. roger, my point i guess, was i got to go back to the late '70s to see a country feeling this despondent and this divided and this uncertain about which way to go with its future, if you really look deep down. would you argue that we're better off now than we were during the clinton years, roger, other than our ipads, that's about the only thing that we got that's better off. other than that, is this period we're in better than what you were presiding over in the clinton administration? >> everybody knows, joe, during

the mid and late '90s we had a powerful economic performance in the united states, and in terms of jobs added and 3% to 4% real growth rate over several years. >> we're there. >> increases in living standards. >> not better off there. >> that was actually the best period in the united states over the past 25 years. >> so we can chock that up to not being better. >> i want to challenge one thing about this country not being quite as partisan and divided. if you look back over the whole sweep of american history, that wouldn't be true at all. we've had many times in the history of this country when things go back -- >> you go back a little further than i do, roger. >> well, we both served in world war i, joe, but seriously, we've had moments like this many times in american history. >> true. >> it's not new, nor is the partisanship or rancor of this moment new. >> we were going to get beyond it this time. >> if i can just say, there's one question that would be interesting to ask of steve and

michelle which is do we know whether, for example, spain is in fact going to apply? >> we'll talk about that after the break. >> is roger staying? >> i don't know. maybe he can, hopefully. fidelity's etf market tracker shows you the big picture on how different asset classes are performing, and it lets you go in for a closer look at areas within a class or sector that may be bucking a larger trend. i'm stephen hett of fidelity investments. the etf market tracker is one more innovative reason serious investors are choosing fidelity. get 200 free trades today and explore your next investing idea.

we're watching headlines from ecb president mario draghi. love to hear what you're hearing down there about what's going on across the pond. >> look, if you know that the economy is weakening and you don't cut rates, you're anti-bernanke. i know that the bond buys, nothing new. the exact same story was that yesterday. i did think it was very meaningful he did not cut rates. that just a disappointment. >> although it does give them the appearance and ability to step in when perhaps there isn't a full bailout in place. >> right. >> and the spanish two-year is going nuts again, they can step in under this authority that they are trying to create or whatever you want to call it and buy that bond aggressively, at least under this new plan. >> multiple-stage bazooka. >> and it doesn't necessarily deal with the overarching issue which continues to be do you really solve a debt crisis with more debt? and i don't know the answer to that. >> there's also questions about sterilization. >> jim, if you're playing the market, are the market going to be disappointed, happy?

what's going to be the sentiment? >> look, i'm going to give you a counter to that. challenger was great, adp was great. weekly claims are great. anything that makes this so europe is off the front page and employment is good means that the rally can continue. >> okay. >> jim, you feel like arguing with liesman? >> what, you mean the fact that he talked about what the band -- >> do you want to point out how wrong cramer was last month on the ecb and i wrote back, no, i don't want to do that? >> what did he -- >> do you want to point out how wrong cramer was, pointing out what liesman said. don't kill the messenger. >> he doesn't realize that, but i'm like griringo in his band. >> more when we come back.

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oh, hey alex. just picking up some, brochures, posters copies of my acceptance speech. great! it's always good to have a backup plan, in case i get hit by a meteor. wow, your hair looks great. didn't realize they did photoshop here. hey, good call on those mugs. can't let 'em see what you're drinking.

you know, i'm glad we're both running a nice, clean race. no need to get nasty. here's your "honk if you had an affair with taylor" yard sign. looks good. [ male announcer ] fedex office. now save 50% on banners. welcome back. ecb president emborzou daragahi has spent the question-and-answer period with reporters defending the ecb's right to buy the bonds and suggesting why it was a monetary policy issue. he said it's necessary to restore capacity to provide monetary policy to our cbs question about the leeriness of the ecb. said i would not agree with this

being a southern cabal or other thing. they will buy ten-year bonds with three-year maturities. i want to toss it to michelle. now this is done, what's the new battle between spain and the ecb, not within the ecb anymore? >> yeah. my understanding is what spain has said behind closed doors is if they entry program, they want to guarantee that the ecb will step in in the secondary market and help them out with interest rates and that thus far the ecb has said if you do ab and c, we may buy on the secondary market. so they want to know that if they do this, if they go through all this, they will actually get some help. >> all right. we're done. got to talk to larry. thanks michelle and steve. cramer was saying the same stuff sorkin was saying. let's thank our guest host. any final thoughts? >> two things, i think a good start for the ecb this morning in terms of what they have done. i think the flight of capital from southern europe is a story yet to be told, and it's